Why life insurance is very important before investing money

Many people ignore insurance. They are not familiar with the different benefits they can get when buying life insurance. They feel like they are only losing money if they spend money to buy insurance. In the world of personal finance, insurance plays a very important role.

In personal finance, we commonly talk about saving money, budgeting money, and even how we should spend our money wisely. Those are just basic things to talk about in personal finance. We should also talk about emergency funds and insurance.

Emergency funds will not be discussed in this article. I think you will prepare your emergency funds before you invest your money. I’ll give you a few reasons why insurance is very important, particularly life insurance. Are you ready?

Investing is very exciting and rewarding. But don’t dive right into investing unless you have emergency funds and, above all, life and medical insurance.

Life insurance is very important because it serves as an income protection for the entire family that is financially dependent on the breadwinner. If the breadwinner is insured and passes away, the family will not suffer financially as they may have the money to survive.

In the world of insurance, the money that family members or beneficiaries are known as “benefits.” The insurance company will deliver an exact amount of money to the beneficiaries of the insured.

Most of the time, the beneficiaries are those people who are financially dependent on the insured. Therefore, if there are people who depend on you financially, you should also immediately purchase a life insurance policy.

Ok, enough about the benefits. Let’s learn the reasons why you need to buy life insurance before investing money.

Your investment funds are not enough to help your loved ones financially. The ideal coverage or face value your beneficiaries should receive when you die is the equivalent of 3-5 years of annual income.

Example, if your annual income is one hundred thousand dollars ($100,000), your beneficiaries should have half a million dollars when you die.

If you have just started investing money and your funds amount to $75,000, your family will be in financial trouble should you die.

Life insurance is one of the important things to consider before investing money. Do not ignore it. Don’t be in a hurry. Plan your investment plan carefully, and one of your investment plans is to protect your income first. I hope you have learned something today. If you have any questions or want to know more about investing, you can read blogs, ask in forums, or attend investment seminars.